Against the backdrop of a shortfall in liquidity caused by the COVID-19 pandemic, the deadline for submitting applications to access the State Aid Scheme "EximBank Guarantees under the COVID-19 State Aid Scheme" has been extended until the 31^st of December.

The procedure of the two state aid schemes consisting of, on the one hand, state guarantees granted for loans contracted by companies and, on the other hand, in subsidized interest loans, entered into force on the 7^th of October 2020. The financing procedure is established by the "EximBank Guarantees under the COVID-19 State Aid Scheme" (NI-GAR-14-I/0) (hereinafter the "Guarantees Norm”) and by the "EximBank Financing under the State aid COVID-19"(NI-FIN-08-I/0) (hereinafter the “Financing Norm"), by means of two decisions issued by the Interministerial Committee on Finance, Guarantees and Insurance, namely Decision no. 257/2020 and, respectively, Decision 258/2020.

Initially, the Guarantees Norm and the Financing Norm provided that the beneficiaries who intend to access the financing program must submit their applications by November the 30^th, 2020. Subsequently, by Decision no. 314/2020 and Decision no. 315/2020, the initial deadline has been extended by another month, so that the applications can be submitted until December the 31^st, 2020.

1.     Beneficiaries 

The program targets both SMEs and large enterprises, understood as enterprises with a turnover of more than 50 million euros.

2.     What does the granted facility consist of?

The Guarantees Norm may provide the beneficiaries with guarantees covering up to 90% of the loans granted by credit institutions. The guarantees may be granted for both new and existing loans, as follows:

• in case of new loans, guarantees can cover maximum 90% of the principal amount;
• in case of outstanding loans, guarantees can cover maximum 50% of the principal amount.

By means of the Financing Norm the state may provide subsidized interest on investment loans or working capital loans. However, these facilities may not be used to refinance other loans, nor may they be used to pay dividends or repay loans to shareholders.

The value of a loan may not exceed:

• double the annual value of the beneficiary's salary expenses in 2019 or in the last available year. In the case of companies established after January the 1^st, 2019, the maximum value of the loan will not exceed the estimated annual value of salary expenses for the first 2 years of activity; or
• 25% of the total turnover of the beneficiary in 2019; or
• the estimated liquidity requirement of the beneficiary over a period of 18 months (in the case of SMEs), respectively 12 months (in the case of large enterprises).

3.     What are the conditions for eligibility?

Both guarantees and subsidized interest loans are granted to beneficiaries who meet, all the eligibility conditions laid down in the norms, on the date of submission of their financing application. In addition to the conditions closely related to the characteristics of the state aid (e.g. beneficiaries to be legal entities), beneficiaries must also meet the following criteria:

• they have a turnover of over 20 million lei in 2019;
• they were not in financial difficulty as of December the 31^st, 2019;
• no decisions to recover state aids have been issued against them or, if such decisions have been issued, they have been enforced;
• they are not in the process of enforcement, operational closure, dissolution, liquidation or special administration and are not the subject to any request to open the preventive composition (In Romanian “concordat preventiv”) or insolvency procedure, at their initiative or at the request of a third-party creditor;
• they do not have outstanding debts to the general consolidated state budget;
• they do not have major incidents with checks and promissory notes in the last 12 months registered with the CIP database, with some exceptions;
• they present the type A debt starting with December the 1^st, 2019 (credit installments are paid at maturity or with a maximum delay of 15 days), according to the CRC database consultation;
• they do not find themselves in litigious matters with either EximBank, the Ministry of Public Finance (MFP) or the National Agency for Fiscal Administration (ANAF).

4.     What are the expenses that can be financed by state aid?

Guarantees and subsidized interest loans can be granted for both investment loans and working capital loans. Under these facilities, certain types of expenditure are eligible, as follows:

1. for investment loans:

• purchase of equipment and related construction-assembly works;
• land and buildings to be used by the borrower;
• intangible assets;
• expenses related to the consulting services and preparation of documentation;
• expenses related to the implementation of the investment project.

2. for working capital loans:

• expenses related to commercial contracts/orders;
• general expenses related to the current activity.